IMF reports show that Dubai has potentially curbed the soaring property market

The Dubai authorities have done enough to temper the emirate’s soaring property market, an IMF official said six months after the fund warned of an “unsustainable” surge in prices.

The IMF sees no immediate need for officials to take further steps to avert a housing bubble after recent measures helped stabilise prices, Harald Finger, who headed an IMF delegation to the UAE, said in an interview in Dubai yesterday.

Dubai home prices climbed 35 per cent last year, the most of any market in the world, according to a survey by Knight Frank. That prompted the UAE Central Bank to curb mortgage lending and Dubai’s government to double the transaction tax.

“The measures that have been put in place have helped,” Mr Finger said. “At this particular moment in time, we would not recommend immediate introduction of any further measures.”

The remarks show that the IMF is becoming less concerned that Dubai will see a repeat of the 2008 property crash that brought the emirate to the brink of default a year later. Residential property-price growth in the emirate slowed in the second quarter this year, broker Colliers International said in September.

Mr Finger also commended Dubai authorities for carrying out large projects at a “much more gradual and measured pace”. As the emirate prepares to host the Expo 2020 international tourism and trade fair, it’s important that the city continues on the track of “very measured implementation in line with reasonable projections for demand,” he said.